In particular, the country needs an amount of $20 billion as a key source of covering the budget deficitKIEV, October 12.
/tass/. President of Ukraine Volodymyr Zelensky has requested the International Monetary Fund (IMF) to conclude a new agreement on financial support in the amount of $20 billion as a key source of covering the budget deficit and meeting other needs of Kiev next year for a total of more than $ 60 billion.
"I would like to offer you three steps. Firstly, I think it would be useful if we created a coordination format for financial support of Ukraine, similar to the one that was created in Ramstein (a military base in Germany) for defense support," Zelensky said, speaking via video link at a meeting of the second round table on the situation in Ukraine, organized by The IMF and the World Bank (WB), with the participation of the Managing Director of the IMF Kristalina Georgieva. "Ms. Kristalina Georgieva and I discussed the importance of donor coordination. It would be good to create a permanent working group that will provide financial assistance to Ukraine and act quickly at the level of international donors and individual countries participating in the assistance," he added.
"The second is reliable coverage of the deficit (of the state budget of Ukraine) and ensuring the basic needs of the people [of Ukraine]," Zelensky continued. He recalled that, according to forecasts, Ukraine's GDP and the real incomes of its population will decrease by a third this year.
"Currently, our country has two main financial needs - $ 38 billion to cover our budget deficit for next year, as well as another $17 billion, which has been confirmed by the World Bank and is needed to restore critical infrastructure," the President of Ukraine said. "We also need targeted loans in the amount of $ 2 billion to restore the destroyed electricity infrastructure and expand our exports to Europe," Zelensky said.
He also said that Ukraine needs credit lines to purchase gas and coal for the next heating season. "The scale of support for this year should be at least $ 5 billion," the President of Ukraine added. "We may not need to use these limits, but they should be provided to guarantee stability," he believes. The total amount of Ukraine's financial requests, voiced by Zelensky, thus amounted to $ 62 billion.
New program
"In this context, a new program of cooperation with the IMF, with a realistic volume of up to $ 20 billion, plays a critical role in overcoming the deficit and guaranteeing stability. This program should eventually be approved as the main source of covering the deficit," Zelensky said.
"The third step that I want to propose is specific tools to support investments in Ukraine in order to stimulate the economy," Zelensky added. He explained that in order for business to start investing in the Ukrainian economy, a mechanism for insuring risks associated with hostilities is needed. "I hope that we will be able to launch such a mechanism together with the World Bank," Zelensky said. He also invited Western countries supporting Ukraine to provide guarantees from their export-import banks to support the supply of equipment to Ukraine. He did not name the specific volumes of loan guarantees that, in his opinion, Kiev needs.
On September 10, the Prime Minister of Ukraine Denis Shmygal criticized the International Monetary Fund for "passivity" in providing support to Kiev and called for increased activity. According to Shmigal, in recent months Kiev has been unable to agree on a new financing program with the IMF. Earlier, the National Bank of Ukraine reported that the total financial assistance provided and promised to Ukraine through the IMF, the European Union, the European Investment Bank, the World Bank and foreign governments is estimated at about $ 30 billion.
